Netflix, Inc. (NASDAQ:NFLX) discreetly increased its monthly subscription fee for new members in Europe by €1.00 to expand its offering of good quality TV shows and films.
Last year, the online video streaming company made a similar price increase for consumers in the United States. Earlier this year, Netflix changes its prices in the Nordics and United Kingdom.
In an e-mail to Bloomberg, Joris Evers, a spokesman for Netflix said the high-definition plan, which allows users to stream video on two devices is now €9.99 per month. The previous price of the high-definition plan was €8.99 a month.
Netflix maintains monthly subscription price for existing European users
According to Evers, the monthly subscription prices for its existing customers in European countries will stay the same for one year. Netflix did not increase the price for non-HD members and premium members at €7.99 and €11.99 per month, respectively.
The price hike will affect most countries in the Eurozone where it operates including France, Germany, and Netherlands.
Future Source Consulting, a British market research firm estimated that Netflix has 750,000 members in France, three times higher than the estimate of released by the French Ministry of Culture.
Netflix has 650,000 members in Germany. It has approximately 4.5 million members in United Kingdom, its largest international market.
Price hike has no material impact on Netflix growth trajectory
Atlantic Equities analyst James Cordwell believes that Netflix has “more room to grow” in Europe. He said, “I don’t think the price increase will have a material impact on their growth trajectory given it’s still a relatively modest sum versus most other pay-tv alternatives.”
According to Netflix, price increase is critical for the company to “continue providing good series and films.” The company’s CEO Reed Hastings has been looking for ways to finance its growing budget for content. Netflix depends on international markets to help boost its future growth and profitability.
Netflix added 2.37 million subscribers from international in the second quarter. The online video streaming company has 42 million members in the United States.
The stock price of Netflix declined more than 1% to $124.05 per share today.
